Welcome to our guests joining us today. Pursuant to Standing Order 108(2), we are studying innovative transportation technologies.

Joining us from the Société de transport de Montréal, we have François Chamberland, director of engineering service, operations; and Étienne Lyrette, corporate advisor, governmental affairs. From the Société de gestion et d'acquisition de véhicules de transport, we have Serge Carignan, director.

Welcome, gentlemen, and thank you for your patience. I know you have a presentation, and then we'll move to questions and answers.

Good morning, everyone. Thank you for this opportunity to speak to you. It is very much appreciated.

Allow me to begin with a brief presentation by the Société de transport de Montréal, the STM.

The STM is the 14th largest business in Quebec. It has more than 9,000 employees and an annual budget of over $1.6 billion. It is quite an elaborate public transit network with 4 metro lines, 68 stations, 759 metro cars, 209 bus routes and more than 1,700 buses. There are 1.2 million passenger trips per day. The STM is thus a major carrier not only in Quebec, but in Canada as well.

All transit authorities in Quebec have opted for electrification. There are eight other transit authorities apart from the STM. The STM's bus fleet represents one-half of transit vehicles in Quebec. If you multiply the STM's figures by two you will have a good idea of what is going on in the province.

We have opted for electricity because electricity is reliable in Quebec. There is an abundance of hydroelectric power. Electricity is also affordable. However, one of the main reasons is that Quebec's electricity is clean because more than 95% of it is generated by hydroelectric means.

A bus uses nearly 40,000 litres of fuel a year. That represents approximately 200 million litres for the Quebec fleet annually. We can consider the current cost of gasoline, but that amounts to a budget of more than $200 million. We want to reduce that dependence and prevent money from being taken out of our pockets and going outside the province, and outside Canada most of the time. It costs one-fifteenth of that amount to run a vehicle, a car or a bus, on electricity rather than on oil.

We also have greenhouse gas emission reduction targets, as the provincial government has stated: 20% by 2020 based on the 1990 figures. We want 95% of the transit vehicle fleet to be electric. Montreal's metro is already 100% electric. Consequently, 50% of passenger trips are already made possible by electricity, but we would like to increase that figure to 95% by 2030.

The STM has set its own objectives in order to achieve that target. The STM's objective is to acquire only zero-emission vehicles, but by 2025. That means that the standard bus that the STM buys in 2025 will be 100% electric and will recharge overnight and be in service all day, achieving, we hope, the same performance as the diesel buses we operate today. Performance is very important. If our buses perform at a lower level, we need more buses, drivers and depots, as a result of which operating costs are much higher. This is something that a transit company the size of Montreal's cannot really absorb.

The public transit of tomorrow will definitely be electric in Montreal by 2025. Electric buses performing to current standards are not yet available, but we have a plan to get there. We have six projects, and that is what I am going to present to you.

We have already changed the standard STM bus. In 2012, the standard bus runs on up to 5% biodiesel. All transit authorities have signed a contract for a group purchase of hybrid buses over a four-year period starting in 2013. Why a hybrid bus? We have taken advantage of a federal program, the Urban Transportation Showcase program, to test hybrid vehicles in cooperation with our colleagues from Gatineau. That is the bus that appears in the photograph. We have been able to compare the performance of this hybrid bus with that of our standard buses.

We have measured fuel savings of 30% in our actual operations in Montreal. Based on our current fuel cost, we will be able to recover our investment by the end of the buses' economic life, which is 16 years. In addition to reducing greenhouse gas emissions and fuel consumption, we will ultimately save a little money. The four-year contract, which will be awarded very soon, covers 1,000 buses for all of Quebec's transit authorities.

We also have another project to introduce electric midibuses in Montreal. Midibuses are a little smaller, 9 metres long instead of 12. They are smaller because current batteries do not perform as well. We cannot have an electric 12-metre bus that performs to the desired level. So we are going with smaller buses. With these buses, we cannot engage in massive public transit on very busy routes. We are targeting tourist routes. Initially, they will be the Old Port in Old Montreal and then Mont-Royal park and places like that.

The STM has ordered seven midibuses. The contract has been awarded, and our call for tenders was of course public. That is part of the problem we want to speak to you about this morning. We received only one bid. A single company is interested in supplying us with electric buses: DesignLine, in the United States. After conducting some checks, we awarded it the contract. For the STM, this is our first experience with electric buses. We will learn a lot about operations, maintenance and engineering. Of course, we will share all we learn with the other transit authorities interested, in both Quebec and Canada.

We cannot achieve the target set by the provincial government, which is to have 95% of passenger trips by electric public transport by 2030, using the smaller buses that I showed you. The heavy traffic is not on the tourist routes, but rather on the major routes. We have two projects addressing the major routes where there are a lot of people, where we have to go fast, where we have to move a lot of people.

The purpose of the first project is to reintroduce trolleybuses to Montreal. We have a study under way. We are looking at three very busy main lines in Montreal and some 100 articulated buses with increased capacity. The trolleybus is an completely proven technology. Today some 40,000 trolleybuses are operating on roads around the world, in snow, on ice and in the mountains, without any problem. This is really not a technological challenge. The challenge, of course, is to convince the city's urban planners to add routes, but we are working very hard on that. We are convinced the public will be very receptive to these buses.

The next project concerns a slightly heavier mode of transportation than trolleybuses. And it is intended for busier routes. It is a tramway system. The City of Montreal and the STM are partners on this one. The objective is to reintroduce tramways to the streets of Montreal. The studies have been completed. We are talking about three tramway lines. The City of Montreal is currently looking for funding. This is quite an expensive project.

We are future-oriented. This is not just about midibuses and trolleybuses: we have to think of all our other bus routes. We have a project under way with our partners, Nova Bus and Bombardier. The idea is to recharge a 12-metre electric bus, a standard bus for the STM, by induction, that is to say without contact. That is what you see in the picture. This is in fact very simple: a plate generates an electromagnetic field when the bus is above it, and a plate under the bus captures the energy without making contact. This is what we want to test. It is really a research and development project. This technology is currently raising more questions than it answers, but we are confident. If it works, and we hope it does, it will help offset current battery performance deficiencies and enable us to put 12-metre electric buses into circulation long before 2025.

The STM still calculates its greenhouse gas emissions by displacement. We take into account not only bus emissions, but also those associated with our buildings and service vehicles. According to a new STM policy, every time we have to replace a service vehicle, whether it be a car, a truck, a van or a special vehicle that operates in the metro at night, we conduct very serious market research to find an appropriate electric vehicle. As you can see, we recently bought a number of Chevrolet Volts. We try to find electric vehicles in every case.

There are also projects at transit corporations other than Montreal's. The nine transit authorities have joined forces and are sharing in all the projects. The people from the Laval authority have bought a fully-electric 40-foot bus and are waiting for delivery. In Quebec City, under the urban transportation showcase program, which the federal government has subsidized, they have bought seven electric microbuses, which are now in operation in Old Quebec. In addition, a project to convert a hybrid vehicle to a plug-in-type electric vehicle is being considered by the Longueuil transit system.

There are no electric bus manufacturers in Canada, and that is really a problem. Some are currently conducting research and development, but, generally speaking, there is no supply in this area in Canada. Supply is very limited even in North America. As we mentioned, in a recent call for bids, only one bidder expressed interest in manufacturing that type of vehicle. Foreign manufacturers are also not very interested in coming to North America because regulations pose numerous challenges for them. In the United States, transit authorities tend not to opt for electricity. Instead they look at natural gas and other substitute products. As electricity is not always produced cleanly, it does not necessarily represent a major advantage. The cost of electricity in the United States and elsewhere in Canada is quite high, and, in many cases, it is produced using fossil fuels.

I told you there were a number of manufacturers in Europe and Asia. However, it is difficult to buy small quantities of these vehicles as a result of regulations. For example, if we want to test four or five vehicles, it is not cost-effective for a foreign manufacturer to provide us with that kind of product on that kind of scale. There will be other challenges when we want hundreds, and that will cause other problems. North American regulations are different from those in Europe and elsewhere, and this is a challenge that we constantly have to overcome.

As previously mentioned, some federal programs have produced results in the past. The urban transportation showcase made it possible for us to evaluate the hybrid buses. Consequently, in our next call for bids, we will buy 500 hybrid buses with an option for 500 more. In other words, this program has produced positive results. The fact that seven electric buses could be tested in Quebec City has opened the door to this technology. This enables us to look into the future and to consider using a vehicle of this kind. In short, financial support has produced results in the past, and I believe the same kind of support will be necessary to enable us to move forward.

Our recommendations are similar to those already stated by my colleague. To provide some assistance in the transition to a fleet of electric buses or, as necessary, a fleet of electric vehicles, the idea would be to facilitate the importing of foreign technologies, at least in the short or medium terms. To be able to conduct trials and pilot projects, an effort should be made to address the issues of standards and compliance with the countries with which we might be doing business.

Support should obviously be provided for the electric transit file through research and development and showcase programs. This is the third time we have mentioned this, but an initiative like the urban transportation showcase program is a very big success story. A technology has been developed and we now see the actual results that has produced. We have taken part in the development of a Canadian industrial sector and we are now buying hybrid buses. These programs are not necessarily financially significant on the scale of the Government of Canada, but they are really promising and have had very positive consequences for both the environment and from an economic and social standpoint.

On a slightly larger scale, transit projects should be eligible for the next infrastructure program. We know the federal government is reviewing its building Canada plan and that public transit was an eligible category in that program. That helped support a number of projects across the country. We would obviously like public transit to remain an eligible category in the next version of the program, which is scheduled for 2014.

Thank you for your attention and for allowing us to share our views with you.

Good morning, gentlemen. Thank you for your presentation. I hope this will encourage you to make a quick switch to these technologies of the future. However, I admit I initially thought, that's it, we will be adopting these electric vehicles very soon, but the more I listened to you, the more I saw the barriers to establishing a full fleet.

If possible, I would like you to tell us about this regulatory flexibility you are seeking that would enable us to import technologies from countries that are clearly ahead of us. I am thinking of certain European countries, for example. Could you give us some examples of the barriers you are facing?